Saudi Arabia’s Price Cuts Lead to Oil Price Decline
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The oil market experienced a downturn as Saudi Arabia reduced the price for its flagship Arab Light crude to Asian customers. This move, which came as a surprise to the market, resulted in a decrease in oil prices. Brent crude saw a 0.9% drop to $78.02 a barrel, while WTI experienced a 1.1% decline to $73 a barrel.
Despite the price cuts, geopolitical tensions in the Middle East and Libya’s National Oil Corp. declaring force majeure at the Sharara oilfield continue to provide support to the market due to concerns over potential supply disruptions.
The decrease in official selling prices (OSPs) for all grades into Europe, the Mediterranean, and the United States for February was also noted by ING’s Warren Patterson and Ewa Manthey in a report. However, the market remains cautious due to the ongoing geopolitical risks.
